Brown Hill and Keswick Creeks Flood Mitigation June 09.wpd

Document Sample
Brown Hill and Keswick Creeks Flood Mitigation June 09.wpd Powered By Docstoc
					 Brown Hill and Keswick Creeks Flood Mitigation




A Review of the Justification for the Construction of
Two Large Detention Dams in the Upper Reaches of
                 Brown Hill Creek




      Prepared by:
            Peter Collins   C.Eng. M.I.C.E., M.C.I.W.E.M
            John Wilson     B.Eng., B.A (Econ).

      With assistance from:
            Cr Grant Hudson      ghudson@mitchamcouncil.sa.gov.au
            Cr Michael Picton
            Cr Judith Weaver

                                July 2009
Contents

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

The Consequences of the Master Plan Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Brown Hill Creek Upstream of Anzac Highway . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

The Way Forward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Identifying and Developing an Optimised Programme of Works . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Summary and Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Appendix 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
     Comparison of Scenario 1, Masterplan and Masterplan Alternative

Appendix 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
     Estimate of cost to increase downstream channel size

Appendix 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
     Economic Justification of Flood Mitigation Projects




                      Disclaimer

                      This document has been prepared by the individuals listed on the title
                      page in support of the recent resolutions of the City of Mitcham
                      regarding stormwater management in the Brown Hill and Keswick
                      Creeks catchments.

                      The statements and calculations within are based on the Brown Hill
                      and Keswick Creeks Flood Mitigation Study and are intended to
                      foster discussion on the benefits and costs of components
                      recommended in the Flood Management Master Plan.

                             This is not an endorsed document of the City of Mitcham.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                                                                    Page 1
Executive Summary

The Brown Hill and Keswick Creek Flood Mitigation Master Plan recommends a schedule and
programme for flood mitigation works with priority for construction of two large flood control dams
in the upper reaches of Brown Hill Creek.

This paper analyses how the dams came to be given that priority; why that priority is no longer
valid; and suggests how to expedite flood mitigation works omitting the dams as proposed in the
Master Plan. Only the tangible costs and benefits are addressed; environmental, heritage and social
costs have not been included.

How the dams were accorded priority
In the first phase of the study, a large number of feasible mitigation component works were analysed
and three mitigation scenarios developed. The scenario giving the best benefit to cost ratio was
shown to be Scenario 1 - Slow down flood waters by detention.

In this scenario, the dams reduced flooding along the complete length of Brown Hill Creek.
Accordingly, the dams could be shown to have a very high benefit to cost ratio, which justified
giving them priority.

What changed to alter the priority given to the dams?
The Scenario 1 schedule of works was put forward for public consultation in November 2005.
However, following that consultation, the schedule of works was significantly changed. A major
detention facility at the Wayville Showgrounds was omitted. It was replaced by channel works to
increase the diversion of flood flows from Keswick Creek to Brown Hill Creek which necessitated a
complete upgrade of the Brown Hill Creek channel downstream of Anzac Highway to handle the
increased flow.

What that meant was that the upgraded Brown Hill Creek channel downstream of Anzac Highway
could carry the 1%AEP flood whether or not the Mitcham dams were built. As a result, the dams as
proposed only have a significant benefit on the reaches of Brown Hill Creek upstream of Anzac
Highway. Building the dams and channel improvements upstream of Anzac Highway costs $19m or
18% of the total, but will only save $4m of present value flood damage over 30 years.

As a result of the decision to upgrade the channel downstream of Anzac Highway, the dams now
have a benefit to cost ratio considerably less than one. Building the Mitcham dams as proposed in
the Master Plan would be a misuse of public money thus a more cost effective alternative to the
dams should be investigated.

Flood mitigation works should proceed
Although building the Mitcham dams is not value for money, the other works set out in the Master
Plan appear to be cost effective and need not be delayed while an alternative flood mitigation
solution is developed for Brown Hill Creek upstream of Anzac Highway. Indeed, early channel
upgrade downstream of Anzac Highway would protect that area earlier.

Revisiting flood damage mitigation options, in the reaches of Brown Hill Creek upstream of Anzac
Highway, raises the potential of integrating storm water reuse into the flood mitigation works rather
than the current intent of retrofitting.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                          Page 2
Background

Hydro Tasmania Consulting was commissioned to carry out a flood mitigation study for Brown Hill
and Keswick Creeks by the Patawalonga Catchment Management Board (antecedent to the
Adelaide and Mount Lofty Ranges Natural Resources Management Board [AMLRNRM]) on behalf
of the Flood Management Group (being the Board and the five catchment councils of Adelaide,
Burnside, Mitcham, Unley & West Torrens).

The study commenced in 2004 and was completed with
                                                                Definition:
the presentation of The Brown Hill and Keswick Creeks
                                                                A 1%AEP event is a stormwater flow
Flood Mitigation Study and Flood Management Master
                                                                the size of which will, on average, occur
Plan (the Master Plan) to the AMLRNRM Board in
                                                                once every one hundred years. The
December 2006. This Master Plan sets out a series of
                                                                corollary of this is that it is considered
works to reduce physical damage from flooding
                                                                each year there is a 1% chance of that
throughout the catchments for up to a 1% Average
                                                                stormwater flow occurring.
Exceedence Probability (1%AEP) storm event.

The Brown Hill and Keswick Creek Flood Mitigation Study was carried out in three distinct phases;

      <     Stage 1 Technical Report       completed in October 2005
      <     Stage 2 Public Consultation    November 2005
      <     Stage 3 Master Plan            completed in December 2006

Key features and relevant issues to each stage are set out below.

The Stage 1 Technical Report

The Stage 1 Technical Report was completed in October 2005 and screened a large number of
feasible flood mitigation components. After grading the individual components three different
scenarios for flood mitigation were assessed:

      1.    Slow down flood waters by detention
      2.    Maximise aesthetic and environmental values
      3.    Enlarge pipes and channels

                                                                Definition:
Scenario 1 was shown to have the highest BCR and the
                                                                BCR (benefit to cost ratio) is calculated
other Scenarios were abandoned for the subsequent stages
                                                                by dividing the present value of the
of the study. The infrastructure works proposed for
                                                                “benefits” (here the reduction in long
Scenario 1 are shown in Appendix 1.
                                                                term average annual damages due to
                                                                flooding) by the present value “costs” of
In Scenario 1 the construction of two dams, in the upper
                                                                providing that reduction in damages.
reaches of Brown Hill Creek, was given high priority
                                                                See also Appendix 3
because, when considered in isolation (i.e. with no other
infrastructure in place), they provided cost effective flood
damage mitigation throughout the Brown Hill Creek catchment.



Review - Brown Hill & Keswick Creeks Flood Mitigation                                                Page 3
Stage 2 Consultation

Community consultation was undertaken during November 2005, based on the recommended
Scenario 1 from the Technical Report. The Master Plan notes that following the consultation stage:

      “A final set of priority works components were then recommended to the Flood Management
      Group in October 2006. The final set excludes the Wayville Showgrounds Arena Temporary
      Storage in favour of a diversion between Keswick and Brown Hill Creeks. The Goodwood
      Orphanage storage had previously been investigated but found to be of limited value. It was
      therefore not included.” A

Stage 3 The Master Plan

The “Brown Hill and Keswick Creeks Flood Mitigation Study - Flood Management Master Plan” was
presented to the AMLRNRM Board in December 2006. The works recommended in the Master
Plan are significantly different from Scenario 1. The Wayville Showgrounds Arena Temporary
Storage was omitted, there is a second diversion from Keswick Creek into Brown Hill Creek and a
major upgrading of the channel downstream of Anzac Highway has been added (note the original
Scenario 1 only allowed for a very minor upgrading at Daly Street). See Appendix 1 for detail.

The Master Plan recommends amongst a series of works the construction of two large detention
dams in the upper catchment of Brown Hill Creek as a priority. The proposal to construct the two
large detention dams has raised serious and valid concerns within many sections of the community.

There appears to be no explanation in the Master Plan, or other documentation, that justifies the
changes that occurred between the Technical Report and the Master Plan, particularly the very
costly downstream channel upgrade ($37m). In the absence of such explanation or justification, the
most reasonable explanation is that the channel upgrade is required to avoid unacceptable flood
damages downstream of the diversion resulting from the additional flows from Keswick Creek into
the Brown Hill Creek channel.

The Master Plan indicates that the base design flow from Brown Hill Creek including the Mitcham
dams in a 1%AEP event is 35m3/sec, the first diversion from Keswick Creek increases the total to
46m3/sec, and the second diversion increases total to 60m3/sec.B If there were no Mitcham dams
but the two diversions occurred, we estimate that total flow would rise to 74m3/sec.

This paper sets out how the revisions, made between the Technical Report and the Master Plan,
appear to have reduced the flood damage benefits attributable to the dams, and establishes the
grounds for a reassessment of the large dams in the rural catchment. Concerns regarding the
proposed dams have also been expressed on environmental and heritage grounds but discussing
these is not the purpose of this paper.



      A
          Master Plan Executive Summary page vi
      B
          Master Plan Section 5.2.2 pages 47-48


Review - Brown Hill & Keswick Creeks Flood Mitigation                                               Page 4
There is certainly a need to address flooding issues in the Brown Hill and Keswick Creek catchments
and this is best done by collaborating on a whole of catchment basis. This paper sets out the basis
for an alternative scheduling of the infrastructure works which will enhance and accelerate
mitigation in most of the problem areas. Rescheduling will allow time to confirm the soundness of
the proposal to build the dams and to identify and develop possible alternative mitigation measures
in the upper half of Brown Hill Creek.



The Consequences of the Master Plan Changes

      The decision to almost double the peak diversion flows into Brown Hill Creek from
      Keswick Creek requires a full upgrade of the channel downstream of the diversion
      point. This has a major impact on the flood damage mitigation attributable entirely
      to building the dams.

Table 4.3 in the Technical Report indicates, for Scenario 1, the capital cost and the individual flood
damage reduction in a 1%AEP event for each component project. The damage reduction attributed
to the dams was calculated to be $61m and the capital cost of the dams was estimated to be $11.72m.
Clearly these figures made building dams appear financially attractive.

The Master Plan provides an estimate of current flood damage cost in each 1%AEP event, broken
down into separate reaches of Brown Hill Creek: C


                           Upstream of Cross Road                  $1.8m
                           Cross Road to Goodwood Road             $4.5m
                           Goodwood Road to Anzac Highway          $1.72m
                           Downstream of Anzac Highway            $62.0m
                                                          Total   $70m


    Of the $70m estimated flood damage that occurs in Brown Hill Creek in a 1%AEP event,
       $62m or 89% of these damage costs are incurred downstream of Anzac Highway.

A limited amount of the flood damage downstream of Anzac Highway is attributable to flood waters
that have broken out of the channel upstream. However, once the channel works associated with the
Keswick Creek diversions and the channel upgrade downstream of Anzac Highway are complete, it
may be expected that flood-waters associated with upstream breakouts will be able to return to the
main channels. As a result, flood damage downstream of Anzac Highway associated with upstream
break outs will become insignificant.




      C
          Master Plan Section 7.1.3


Review - Brown Hill & Keswick Creeks Flood Mitigation                                          Page 5
The dams can be shown to have very high flood damage reduction potential and a high BCR when
looked at in isolation. When the channel downstream of Anzac Highway is upgraded this situation
appears to change radically as shown below.

To completely eliminate flooding in this reach, the design flow proposed in the Master Plan for the
upgraded channel is approximately 60 m3/s. This is made up of the reduced flow contributed from
the Brown Hill Creek channel (35 m3/s) plus diversions from Keswick Creek (25 m3/s) D. The effect
of building the proposed dams is to reduce peak flows in Brown Hill Creek (1%AEP) by
approximately 14m3/sec E. Therefore, if no dams were to be constructed, to give similar flood
damage reduction the capacity of the channel downstream of Anzac Highway would need to be
increased to 74m3/sec.

To achieve the increased capacity, we suggest the cross sectional dimensions of the upgraded
channel would need to increase from the proposed 8m x 2m to approximately 8.5m x 2.2m. The
marginal cost of increasing the channel dimensions is estimated to be $4m based on an approximate
10% increase over and above the $37m in the Master Plan (see Appendix 2).

It is possible that this additional upgrade would not be necessary. The State Government's Principal
Stormwater Engineer has indicated that the upgraded channel, as sized in the Master Plan, is
capable of concurrently conveying the estimated 1%AEP flows from both creeks even if the
Mitcham dams are not built due to the difference in characteristics of the flow contributions.F This is
contrary to the impression given in the Master Plan. That is, the Principal Stormwater Engineer has
stated that there is no need to change the channel dimensions proposed in the Master Plan whether
or not the dams are built.

Building the dams makes very little, or possibly no difference, to the cost of infrastructure required to
mitigate flood damage costs in the reaches of Brown Hill Creek downstream of Anzac Highway. In
other words:

      Once the channel upgrade is in place, the dams are only of significant benefit to the
      reaches of Brown Hill Creek upstream of Anzac Highway.

The cost of infrastructure works proposed in the Master Plan upstream of Anzac Highway is $19m,
made up of $17m for the dams and $2m for channel works adjacent to Cross Road. The Master
Plan indicates these works will, in a 1%AEP event, reduce the estimated flood damage costs
upstream of Anzac Highway from $8m to $2.6m.

An indicative economic analysis of the BCR attributable to the dams alone and the dams in
conjunction with the channel upgrade has been carried out using information derived from the



      D
          Master Plan Section 5.2.2 pages 47-48
      E
          Master Plan Section 5.2.2 page 46
      F
          Letter from the Principal Stormwater Engineer to the Project Director, 9th June 2009.


Review - Brown Hill & Keswick Creeks Flood Mitigation                                             Page 6
Master Plan. It clearly shows how the BCR of the dams is reduced by an order of magnitude from
around 3 to 0.25 when the channel upgrade is included.



                        Indicative Analysis of the Benefit to Cost Ratios
                          Using Data Available from the Master Plan



                                                                                            BCR
                         Flood Damage Cost Reduction Attributable to the Dams
                                                                                     (Present value of
                                                                                     the flood damage
                                                                                         reduction
 Scenario
                                                                                    attributable to the
                                            Average Annual     Present Value Cost     dams divided by
                       Per 1%AEP Event
                                                CostG          (7% over 30 years)   their capital cost -
                                                                                           $17m)


 Dams alone                 $70mH                $4.3m               $53m                    3


 Dams and                   $5.4m
                                                 $0.34               $4.2m                 0.25
 channel upgrade       (=8.0m ! 2.6m)



The BCR is further reduced by a reduction in flood damages in the order of 10% - 60% I when
community education and planning policy changes are taken into account. Education should
include the current FloodSafe program being run by the SES with funding assistance from many
councils including the City of Mitcham. Councils should also ensure future development is
appropriate within the 1%AEP flood plain through Development Plan Amendments.




     G
         This takes account of the damage and chance of all levels of floods. In the absence of other
             information, this was pro-rated from data in the Master Plan, and so in effect has the
             same weighting for each level of flood.
     H
         For the purposes of the indicative analysis this figure represents the maximum possible value
             as it takes no account of residual flood damage (there is insufficient information
             available to assess residual damage).


     I
         Technical Report Section 3.3.8


Review - Brown Hill & Keswick Creeks Flood Mitigation                                             Page 7
Brown Hill Creek Upstream of Anzac Highway

While it is technically possible to build large detention dams, it is not considered an economic way
of mitigating flooding in the catchment of Brown Hill Creek upstream of Anzac Highway.

                 Until this situation is satisfactorily resolved or explained in detail,
             proceeding with further design work for the dams is an untenable position.

To quote the Master Plan:

                            “Potential solutions needed to be cost effective otherwise
                       it would be difficult to justify the expenditure of public money.” J

Scenario 2 of the Technical Report provided limited studies of potential flood mitigation
opportunities in the reaches of Brown Hill Creek upstream of Anzac Highway other than the dams.
It allowed $5m for channel works at Cross Road and Hampton Street and provided a $0.9m
detention basin at Goodwood Orphanage K. The result of these works would be to provide
significant flood damage mitigation but less than that provided by the dams in Scenario 1.

The studies included in Scenario 2 for works in the reaches of Brown Hill Creek upstream of Anzac
Highway are not adequate to pin point a properly optimized programme of flood damage mitigation
works. Further work would be needed.



The Way Forward

Given the available information, the dams have been shown to not be cost effective. However, the
alternative is not to “do nothing”. The other works set out in the Master Plan need not be delayed
while an optimized cost effective solution is developed for flood damage mitigation in Brown Hill
Creek upstream of Anzac Highway.

The Master Plan points to how a flood mitigation programme should be scheduled: L

      “Major Channel upgrades should progress from downstream to upstream and ideally should (but
      not must) follow the construction of temporary flood storages.”




      J
          Master Plan Executive Summary page ii
      K
          Costs based on those in Technical Report increased by 30% to allow for direct comparison
              with the Master Plan costings.
      L
          Master Plan Section 8 “Priorities and Timeframes”.


Review - Brown Hill & Keswick Creeks Flood Mitigation                                               Page 8
The programme for implementing the project as set out in the Master Plan is as follows with indicative
completion dates for a ten year program in parentheses:

      !     Stage 1 and Ongoing:
            "     Flood preparedness;
            "     Planning measures.
      !     Stage 2 (by Year 4):
            "     Brown Hill Creek Flood Control dams;
            "     Ridge Park temporary flood storage;
            "     Mount Osmond Interchange temporary flood storage; and, Temporary flood
                  storages in the South Park Lands.
      !     Stage 3 (by Year 6):
            "     Upgrade Brown Hill Creek channel downstream of Anzac Highway;
            "     Increase capacity of Fullarton Road/Greenhill Road culvert.
      !     Stage 4 (by Year 8):
            "     Install diversions between Keswick and Brown Hill Creeks.
      !     Stage 5 (by Year 10):
            "     Increase channel capacity at Fisher Street;
            "     Increase channel capacity at Hampton Street.

If the Brown Hill Creek flood control dams are deleted on the grounds they are uneconomic, the
programme needs to be modified, as suggested below, to reflect their omission and allow sufficient time
to develop and construct a cost effective alternative.

      !     Stage 1 and Ongoing:
            "     Flood preparedness;
            "     Planning measures;
            "     Identify and develop an optimized works programme for Brown Hill Creek
                  upstream of Anzac Highway.
      !     Stage 2:
            "     Ridge Park temporary flood storage;
            "     Mount Osmond Interchange temporary flood storage;
            "     Temporary flood storages in the South Park Lands.
      !     Stage 3:
            "     Upgrade Brown Hill Creek channel downstream of Anzac Highway;
            "     Increase capacity of Fullarton Road/Greenhill Road culvert.
      !     Stage 4:
            "     Install diversions between Keswick and Brown Hill Creeks.
      !     Stage 5:
            "     Channel and other works in Brown Hill Creek upstream of Anzac Highway.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                           Page 9
Identifying and Developing an Optimised Programme of Works

The Master Plan’s dam sizes were set by the downstream channel capacity at Cross Road.M So,
although the dams are effective in mitigating floods, the present value of their cost far exceeds the
present value of the benefit they provide in terms of flood damage reduction.

              That is, the BCR of the dams is very low and significantly less than one.
                              They cannot be economically justified.

Omitting the dams from the schedule of priority mitigation works provides the opportunity at this
stage to reconsider all the available options, individually and in combination, in an environmentally
sensitive way. This will give an optimized solution to flood damage mitigation in the reaches of
Brown Hill Creek upstream of Anzac Highway.

This paper has provided a basis for believing that the dams proposed in the Master Plan are
uneconomic and not justifiable precisely because an effective optimization process was not
undertaken between Stages 2 and 3.

It is not within the scope of this paper to identify or prioritize all the mitigation opportunities that
should be considered to mitigate flooding. They could include:
       !      Non structural actions (including the current FloodSafe program);
       !      Channel modifications;
       !      Detention basins;
       !      Small detention dams;
       !      Local flood protection measures including road shaping (to form a levee), levee banks
              and individual property protection.

It is important to recognize that this optimization will give a solution in which the resultant damage
mitigation will be not be the same in all reaches as that offered by building the dams.

           The solution could be fully justifiable and propose a better use of public money.

Significantly, the need to consider a new approach to flood damage mitigation in Brown Hill Creek
upstream of Anzac Highway offers the prospect of integrating storm water reuse with the mitigation
works. The approval of the Master Plan as a Stormwater Management Plan by the South Australian
Stormwater Management Authority was subject to:

      “Any proposal to implement a component of works identified in (or arising out of) the
      Stormwater Management Plan must incorporate, wherever practicable, aquifer storage and
      recovery or other stormwater reuse scheme together with improvement in water quality and
      biodiversity outcomes to the satisfaction of the Authority.”N


      M
          Technical Report Section 3.3.3.2
      N
          Minutes of the SMA 19th February 2008


Review - Brown Hill & Keswick Creeks Flood Mitigation                                             Page 10
In order to achieve that aim, it has been suggested that the dams proposed in the Master Plan could
possibly be integrated at some later date into a reuse programme.

                Such a retrofit approach may lead to a further sub optimal project.



Summary and Conclusions

      1.    In Scenario 1 of the Technical Report, the Mitcham dams were shown to have a high
            BCR, and were accorded a high priority for implementation. However, it is believed
            this assumption became no longer valid when the component projects of Scenario 1
            were significantly revised in the Master Plan.

      2.    As a result of the inclusion in the Master Plan of a major upgrade of the Brown Hill
            Creek channel downstream of Anzac Highway, the Mitcham dams provide negligible
            flood mitigation benefits in the reaches of Brown Hill Creek downstream of Anzac
            Highway, only upstream.

      3.    The Master Plan infrastructure proposals for the reaches of Brown Hill Creek upstream
            of Anzac Highway are estimated to cost $19m (channel works $2m, dams $17m). The
            flood damage cost reduction derived from implementing these proposals is only $5.4m
            in a 1%AEP event. To build the dams as proposed in the Master Plan is not
            financially responsible.

      4.    Given the above, the Mitcham dams have not been demonstrated to be economically
            justified. Not building the dams is also supported on environmental, heritage and
            planning (Hills Face Zone) grounds. Additionally, the lack of stormwater reuse
            planning at the Master Plan stage may necessitate retrofitting solutions that could be
            suboptimal.

      5.    It is suggested that implementation of the component infrastructure works identified
            in the Master Plan, other than the Mitcham dams, should proceed while an economic
            alternative for flood damage mitigation is identified and developed for the reaches of
            Brown Hill Creek upstream of Anzac Highway.

      6.    The need to identify and develop a new optimized solution to flood damage mitigation
            in the reaches of Brown Hill Creek upstream of Anzac Highway will provide the
            prospect of integrating environmentally sustainable water reuse opportunities with
            flood damage mitigation.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                       Page 11
                                                                                                                                                                       Alternative
                                                         Mitigation Component                                                                 Scenario 1    Masterplan based on
                                                                                                                                                                       Scenario 2
                                                                                                                                                                                                                                                         Appendix 1


                                                         Upgrade Fullarton Rd/Greenhill Rd culvert                                              $1.95m         $2.7m          $2.7m
                                                         Series of detention basins in the South Park Lands                                     $7.85m         $10m           $10m
                                                         Modify Mt Osmond Interchange Dam outlet                                                $0.01m         $0.1m          $0.1m
                                                         Develop an inline flood detention system in Ridge Park Reserve and rehabilitate       $0.356m         $0.6m          $0.6m
                                                         stream
                                                         Upgrade culverts under Fisher St                                                       $2.95m         $4.0m          $4.0m
                                                         Goodwood Road Diversion from Keswick Creek to Brown Hill Creek                            --         $16.0m          $16.0m
                                                         (approximate capacity 14 m3/s)
                                                         Railway diversion from Keswick Creek to Brown Hill Creek                                  -          $16.0m          $16.0m
                                                         (approximate capacity 11 m3/s)
                                                         Flood Control Dams Brown Hill upstream of the Recreation Park                         $11.72m         $17m             -




Review - Brown Hill & Keswick Creeks Flood Mitigation
                                                         Increase channel capacity between Hampton Rd & Cross Rd                                $1.46m         $2.0m          $5.0m*
                                                                                                                                                                                       Comparison of Scenario 1, Masterplan and Masterplan Alternative




                                                         Upgrade Brown Hill Creek channel from downstream of Anzac Hwy to confluence                          $37.0m          $41m
                                                         Construct offtake at Goodwood Road and divert into the showground                     $11.357m           -
                                                         Keswick Creek diversion under Anzac Highway to Brown Hill Creek                       $7.881m            -
                                                         Daly Street Bridge and Culvert                                                         $2.22m            -
                                                         Orphanage Detention                                                                       -              -           $0.9*m
                                                         Total                                                                                 $47.755m       $105.5m         $96.3m


                                                        Note: The costs shown for Scenario 1 are not directly comparable with those in the Masterplan.




Page 12
                                                          * Costs have been abstracted from Scenario 2 of the Technical Report and have been increase by approximately 30%.
Appendix 2
Estimate of cost to increase downstream channel size

The estimated difference in cost to construct the upgraded channel downstream of Anzac Highway
with dimensions of 8.5m x 2.2m instead of 8m x 2m was estimated on the following basis:

      '     30% works associated with reinforced concrete 7.5% increase
      '     30% works associated with excavation 17% increase
      '     30% works associated with mobilisation, demobilisation, supervision etc 5% increase
      '     10% miscellaneous acquisition etc based on width of channel 5% increase

Overall average increase in costs 10%.

Master Plan cost for the 8m x 2m channel $37m .

Therefore increase in cost to construct the larger channel $3.7m or rounded to $4m.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                    Page 13
Appendix 3
Economic Justification of Flood Mitigation Projects

For a project to be financially justified, it must reduce the costs of flood damage by more than its
cost of construction and operation, and must be better than alternative projects to achieve the same
flood reduction – its costs must be lower than the alternative. However, an issue in making a choice
of a project is that in general the capital costs are up front, but the benefits of reduced flooding costs
are spread over the future; operating costs are also spread over future time, but are usually less
significant. Projects will be more economically attractive if their costs are delayed relative to the
benefits of flood reduction.

Present Value
Economists decide between projects with different cashflows over time by bringing the costs and
benefits back to a common time by calculating the “present value”. The concept behind this is best
explained by a simple example: if you were given a choice between receiving $1 now or $1.10 in a
year’s time, what would you choose if you could invest the $1 now at 10% interest rate? Investing $1
now would earn $0.10 interest over a year, so that at the end of the year, you would have $1.10. In
this case, you would be indifferent to receiving $1 now or $1.10 in a year’s time.

What if you were offered $1.05 in a year’s time? That would be less value to you than receiving $1
now and investing it at 10% interest rate, so you would choose to receive $1 now rather than $1.05 in
a year. The “present value” of the $1.05 is less.

To calculate the present value (PV) of a future cash flow, divide the future cash flow by one plus the
“discount rate” (ie one plus the interest rate) for the number of years in the future. For example:


      PV at 10% discount rate of $1.05 in 1 year’s time      = $1.05/(1+0.10) = $0.955
      PV at 10% discount rate of $1.05 in 2 year’s time      = $1.05/(1+0.10)/(1+0.10) = $0.868
      To generalise, PV at i% discount rate in n years       = Future value /(1+i/100)n


When there are multiple years of future cashflow, simply discount each of those future values and
add to get a total present value. For example, if the future values are $1.05 in 1 year plus $1.10 in 2
years, then:


        Total PV at 7% discount rate         = PV of year 1 cashflow + PV of year 2 cashflow
                                             = $1.05/(1.07)+ $1.10/(1.07)2
                                             = $0.981 + $0.961
                                             = $1.942


Note that in this example, the $1.10 in 2 years has lower present value than $1.05 a year earlier, even
though the future value has increased. This is typically what happens: as cashflows get further into
the future, their present value contribution decreases.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                             Page 14
Net Present Value of Cost of Flood Mitigation & Flood Damage
In the flood mitigation economics, there are initial cash outflows of the project capital costs, offset by
reduced costs of floods in future years – that is a reduced future cash outflow. The present value of a
project component is the sum of the PV benefits of future flood cost reductions less the PV capital
cost of the flood mitigation project.

If the PV of future flood reductions is greater than the PV capital cost, then the net PV (NPV) is
positive, and the project is economically attractive compared to doing nothing. However, it still has
to be better than all alternatives that achieve the same flood reduction. If the NPV is negative (ie PV
benefits are less than PV costs) the project is unattractive – the community is spending too much to
reduce floods.

Benefit to Cost Ratio
BCR (benefit to cost ratio) is calculated by dividing the present value of the “benefits” (here the
reduction in long term average annual damages due to flooding) by the present value “costs” of
providing that reduction in damages. If NPV of the project is greater than zero, then the BCR is
greater than 1 and the project is attractive.



Optimum Level of Flood Mitigation
The optimum level of flood mitigation does not mean elimination of all flooding. It means that the
total of PV flood mitigation costs + PV of residual flooding is minimised.



           Optimising the scale of flood mitigation works        For an economic rationalist, the aim
                                                                 of flood mitigation is to minimise the
                                                                 total expected present value cost of
                               Reasonable                        mitigation and flooding.
Cost ($)




                                                                 Up to the optimum, each $1 of
                                                                 mitigation reduces the present value
             Optimum
                                                                 expected cost of flooding by more
                                                                 than $1. Beyond the optimum, it
                                                                 costs more to mitigate floods than is
                                                                 saved in reduction of damage.
                       Scale of Mitigation Works

                        Cost of Flood Mitigation Works           In practice, the chance of flooding
                        Cost of Expected Present Value Damages
                        Sum of Work and Expected PV Damages      and costs are not precisely known,
                                                                 and there are qualitative values
                                                                 included, so there is a range of
                                                                 acceptably attractive mitigation
                                                                 expenditures.




Review - Brown Hill & Keswick Creeks Flood Mitigation                                            Page 15
Addendum to “A review of the Justification for the Construction of Two
Large Detention Dams in the Upper Reaches of Brown Hill Creek”
Since finalising this report we (the authors of the Report) have read the document attached to the
agenda for the City of Mitcham Full Council meeting on 28th July 2009: “Project Brief Stage 2,
Further Investigation and Preliminary Design of Flood Mitigation Storage on Brown Hill Creek
and, Stage 3, Final Design and Documentation of Flood Mitigation Storage on Brown Hill Creek”,
prepared by the City of Unley on behalf of the Stormwater Management Authority (SMA).

Stage 2 (part 1) of the Project Brief sets out the basis for an economic reevaluation of the
justification for building the two detention dams proposed in the Master Plan. It also proposes that
the option of building only the larger of the two dams be evaluated.

We applaud the decision by the Brown Hill and Keswick Creek Stormwater Project (BHKCSP) to
ask for a reevaluation of the economic justification for building the two dams. We believe the
reevaluation will confirm our findings that they cannot be justified. However, we have serious
concerns regarding the implementation arrangements and the methodology proposed.

Flaws in the Brief
Currently the economic reevaluation of the dams is tied to an ongoing contract for the design of
the dams. Such an arrangement will inevitably give rise to questions about the objectivity
of the reevaluation process. Despite clauses in the brief denying such a link, we believe it still
gives that impression.

The parameters set for the reevaluation of the two dams are ambiguous, incomplete and flawed.
The benefit to cost ratio (BCR) of the two dams should be reevaluated on the basis that all the
infrastructure work proposed in the Master Plan is in place.

The concept of generating dam benefit data for one dam by apportioning two dam data is
demonstrably flawed.

The size/capacity and the discharge provisions of each of the proposed dams have been
determined on the basis of the two acting conjunctively. If, as a result of further studies, a single
dam could be shown to be economically viable it will be very different from the Master Plan dam.

Summary
We support the decision of the BHKCSP to reevaluate the economic justification for the dams but
suggest that current proposals be revised as follows:

     1. The reevaluation process to be set up completely independently of any design contracts.
     2. The reevaluation to consider only the Master Plan proposal of the two dams
     3. The basis for the reevaluation to be
        • All infrastructure works set out in the Master Plan other than the dams are completed.
        • For flood damage assessment the model used in the preparation of the Master Plan
           with cost updated to 2009 values.
        • The dam construction costs to include all oncosts and supporting infrastructure
           modifications and based on the latest available estimates.
If the dams are confirmed as not being economically justifiable, then a complete reassessment of
options (which should include looking at dams of different design/capacity) for the reaches of
Brown Hill Creek upstream of Anzac Highway should be instigated, as set out in our report.



Peter Collins and John Wilson - 28th July 2009

				
DOCUMENT INFO
Shared By:
Categories:
Stats:
views:47
posted:4/17/2010
language:English
pages:17
Description: Brown Hill and Keswick Creeks Flood Mitigation June 09.wpd